Prioritization of Capital Needs Inventory

Transcription

1 Finance, Administration and Oversight Committee Information Item IV-A October 8, 2009 Prioritization of Capital Needs Inventory

2 Washington Metropolitan Area Transit Authority Board Action/Information Summary Action Information MEAD Number: Resolution: Yes No TITLE: Prioritization of the Capital Needs Inventory PURPOSE: To discuss the capital needs prioritization process that was developed based on Metro`s strategic goals and present staff recommendations resulting from the prioritization process. This information will serve as the foundation for future capital programming and the development of a regional funding strategy for Metro. DESCRIPTION: In September 2008, Metro staff presented to the Board the Capital Needs Inventory (CNI), which outlined over $11 billion in needs over the next 10 years (FY 2011 to FY2020). The CNI includes Performance/safety projects ($7.6 billion, 67% of total) and Customer/demand/safety projects ($3.8 billion, 33% of total). Performance/safety projects maintain and replace assets on a life cycle basis. They promote safety and reliability and preserve the current levels of service. These projects keep Metro in a "State of Good Performance" - assets are not simply replaced with an exact replica, but with assets that take advantage of the latest technology and materials. Customer/demand/safety projects help meet growing ridership requirements and improve the rider`s experience. Safety needs are included throughout the CNI. The CNI established Metro`s capital needs baseline. This was the first step in a strategic capital planning process designed to identify critical projects and support Metro`s goals. The next step was to identify what projects should be fixed first, Metro staff ranked the CNI projects based on Metro`s five goals: (1) create a safety culture, (2) deliver quality service, (3) use every resource wisely, (4) retain and attract the best and the brightest, and (5) maintain and enhance Metro`s image. The following table provides a few examples of CNI projects that are strongly linked to Metro`s goals.

3 Goals Examples of Capital Projects with Strong Linkage Create a Safety Culture Police Radio Replacement Escalator Rehabilitation Chemical Detector Enhancements Delivery Quality Service Bus Replacement Track Rehabilitation Platform Edge Bumpy Domes Installation 75% 8-Car Trains (Cars, Storage, Power) Use Every Resource Wisely Retain and Attract the Best and Brightest Maintain and Enhance Metro`s Image Test Track & Commissioning Facility Construction Underground Storage Tank Replacement Bus Rehabilitation Police Training Facility Bus Garage Replacement/Rehabilitation Website Update- Customer Communication Automatic Vehicle Location Equipment To address the impact of funding constraints, Metro staff conducted a rigorous prioritization process endorsed by the Brookings Institution. In this process, Metro staff analyzed CNI projects based on their linkages to Metro`s five strategic goals and their relative priority to other projects in the two CNI categories: Performance/safety and Customer/demand/safety. In addition, the analysis took into account project budget, asset age and policy considerations. The results enabled staff to determine which projects should be funded first and which would need to be deferred to beyond FY2020. For example, if Metro`s funding continued at recent levels (~$500 million per year), only 69% of Metro`s Performance/safety needs would be met and zero funding would be available for Customer/demand/safety needs over the FY timeframe. At historical funding levels, Metro would not be able to fully fund the investments needed to maintain the system`s safety and reliability. In addition, Metro would not be able to address projected ridership growth or provide customer improvements. If capital funding were increased to over $800 million per year, key Performance/safety needs could be addressed (e.g., rehabilitation of oldest rail system sections, replacement of older vehicles, replacement/rehabilitation of

4 three bus garages, and information technology system upgrades), but repairs to some of Metro`s newer assets, including its youngest rail line segments, rail yards and bus garages would be deferred to after FY Under an $8 billion ten-year capital program, key Customer/demand/safety needs that could be addressed include achievement of 100% 8-car trains, safety and security enhancements (e.g., NTSB recommendations, police training facility, bumpy domes) and partial expansion of the MetroBus and MetroAccess fleet; however, several valued Customer/demand/safety needs such as enhanced core station capacity, 30% of bus fleet expansion, and bicycle and pedestrian facilities would be deferred to fund higher priority Customer/demand/safety projects first. Metro is prepared to deliver a larger capital program given that a significant share of the CNI is devoted to the purchase of rail cars, buses and equipment. In addition, Metro has initiated the Rail System Infrastructure Rehabilitation contracting approach to increase productivity during track work hours. Finally, Metro would implement advance procurement actions to ensure timely delivery of a capital program. Jurisdictional commitment to Metro`s capital program has been critical to our success. A continued commitment would enable Metro to deliver projects that require long contract horizons (e.g., rail car procurement) and achieve savings through larger contracts. A steady capital program that would replace assets based on life-cycles would result in cost savings and improved service reliability. A multi-year capital program would provide Metro the stability and flexibility we need to be the Best Ride in the Nation. In the coming months, Metro staff will publish the Capital Needs Inventory, develop a draft multi-year capital improvement program, draft the FY 2011 Capital Budget, and work with the Board and regional partners to finalize our next funding agreement, which will be effective July 1, Prioritization of the CNI will continue to enable staff to link Metro goals to capital investment decisions, establish a transparent and replicable process, address funding constraints, and reinforce the foundation for capital programming. FUNDING IMPACT: This is an information item. The long-term funding impact will be determined by the capital program and the next capital funding agreement. RECOMMENDATION: For information only. Future Board endorsement of staff recommendations is necessary to support the next capital funding agreement.

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6 Pi Prioritization iti of fthe Capital lneeds Inventory Finance, Administration i ti and Oversight Committee October 8, 2009

7 Purpose Discuss the capital needs prioritization process developed based on Metro's strategic goals; Present staff-recommendations resulting from prioritization process; and Support future capital programming and the development of a regional funding strategy for Metro.

8 FY 2011-FY 2020 Capital Needs Inventory (CNI) Metro s capital needs: $11 billion Performance/Safety Focus: Projects that maintain and replace assets on a regular life cycle basis to deliver the same level of service Customer/Demand/Safety Focus: Projects that help meet growing ridership and improve the rider s experience Performance /Safety Focus $7.6 Billion 67% Customer/ Demand/ Safety Focus $3.8 Billion 33% Safety needs are included throughout the CNI

9 Context for Capital Needs The FY 2011 FY 2020 capital needs are driven by several factors: Rail system infrastructure built when system opened is reaching the end of its lifecycle Metro must replace its original railcars Infrastructure repairs are required for system safety and reliability Information Technology and MetroAccess capital costs are now included Buses need to be replaced and rehabilitated Bus garages and rail yards must be rehabilitated or replaced What s not included in the capital needs inventory: System expansion projects (new entrances, stations, or rail lines) Transit projects to be funded entirely el by the jurisdictions Debt repayment costs

10 Metro s Strategic Capital Planning Process 1. Generate Capital Needs Inventory (Sept 2008) 5. Monitor Delivery and Outcomes Metro Goals 2. Prioritize Capital Needs (Sept 2009) 4. Deliver 3. Program Capital Capital Budget Program (Dec 2009)

11 Why Prioritize Capital Needs? Link agency goals to capital investment needs Address funding constraints Articulate system consequences at different funding levels Establish a transparent and replicable process Successfully used to select stimulus projects arra dc aspx Set up foundation for capital programming

12 Metro s Strategic Framework Goals Objectives Create a Safety Culture Deliver Quality Service Improve customer and employee safety Strengthen Metro s safety & security response Improve reliability of service Enhance regional mobility Maximize customer satisfaction Increase service and capacity Use Every Resource Wisely Retain and Attract the Best and Brightest Maintain and Enhance Metro s Image Manage assets efficiently Reduce operating costs Use natural resources wisely, lower environmental impacts Support workforce development Enhance communication with customers Promote regional economy

13 Capital Project Linkage to Goals Goals Create a Safety Culture Delivery Quality Service Use Every Resource Wisely Retain and Attract the Best and Brightest Maintain and Enhance Metro s Image Capital Projects with Strong Linkage Police Radio Replacement Escalator Rehabilitation Chemical Detector Enhancements Bus Replacement Track Rehabilitation Platform Edge Bumpy Domes Installation 75% 8-Car Trains (Cars, Storage, Power) Test Track & Commissioning Facility Underground Storage Tank Replacement Bus Rehabilitation Police Training Facility Bus Garage Replacement/Rehabilitation Website Update-Customer Communication Automatic Vehicle Location Equipment * All projects improve safety

14 Impact of Funding Constraints Performance / Safety Projects Like New Slightly Used Falling Apart 100% Not 24% 76% Not 31% 69% Customer/ Demand/ Safety Projects 100% Not Not 63% 37% 100% $11 B $8 B $5 B Accelerated asset management & expansion Safe and reliable system Improved customer amenities Steady asset management Maintain safe & reliable system Moderate system expansion (Bus, MetroAccess) $0 Assets in state of disrepair Unreliable system Overcrowded conditions

15 Impact of ~$8 Billion Funding Constraint Performance/ Safety Projects Not $1.8 B 24% $5.8 B 76% Customer/ Demand/ Safety Projects Not $1.4 B 37% $2.4 B 63% 1000, 2000, 3000 Series Rail Cars replaced; 4000 Series Rail Cars rehabilitated 100% 8-Car Trains implemented Oldest segments of rail system (e.g. Red Line) rehabilitated Track Rehabilitation ti and Metro Transit Police needs met Bus fleet, garages, and priority corridor network expanded Unfunded/Deferred 37% of customer/demand needs (including core station capacity) deferred Rehabilitation of newest assets (rail system segments, bus garages, and rail yards) deferred 30% of Bus fleet expansion needs deferred

16 Recommendations Resulting From Prioritization Process Continue to Make Safety a Top Priority NTSB recommendations Safety projects prioritized in the Capital Needs Inventory

17 Recommendations Resulting From Prioritization Process (continued) Performance/Safety Projects Replace and rehabilitate buses and rail cars based on life cycle Rehabilitate sections of rail system more than 30 years old Replace/rehabilitate three bus garages Fully fund Track and Structure capital needs Fully fund Metro Transit Police capital needs Upgrade most critical IT software and hardware needs

18 Recommendations Resulting From Prioritization Process (continued) Customer/Demand/Safety Projects Provide 100% 8-car trains, power, storage Support bus fleet expansion to meet growing demand Enhance safety and security (e.g., police training facility, cameras, bumpy domes) Plan and design core capacity enhancements

19 Delivering the Capital Program Metro can deliver projects at increased funding levels because: Significant ifi share of program dollars is for acquisition iti of rail cars, buses and equipment Rail System Infrastructure Rehabilitation conducted by contractors, approach will also increase productivity during track work hours Advance procurement action will be taken to ensure timely program delivery

20 Next Capital Funding Agreement: Draft Guiding Principles Capital needs prioritized based on Metro s strategic goals Assets replaced based on life-cycles l to obtain cost savings and service reliability Establish revenue stability so Metro can effectively plan and enter into long-term contracts (e.g., 5-year rail car procurement) Commitment to match federal funding with local funding Require accountability, yet provide flexibility to address changing needs and to maximize benefits for customers

21 Framework for Future Capital Programming Rolling multi-year capital program updated annually Established guidelines for reprioritization iti support agency strategic goals within anticipated funding First year of multi-year program = proposed capital budget for following fiscal year and contract approval Jurisdictional review and comment and opportunity to highlight policy decisions prior to capital budget and multi-year program approval

22 Next Steps Oct March: Funding Agreement Working Group Comprised of jurisdictional staff Establish guiding principles (e.g., match federal funding) Propose funding arrangement framework (e.g., timeframe) Discuss proposed program resulting from prioritization effort Identify terms for negotiation (e.g., reporting requirements) Guide negotiation Fall: Publish the Capital Needs Inventory December: FY2011 Budget presented to Board June 30, 2010: Capital Funding Agreement signed

23 WMATA Capital Needs Inventory (CNI) Prioritization Summary of CNI Projects by Asset Category and Project Type Under Funding Constraints Performance/Safety Focus Projects $11 Billion Asset Categories Project Type (CNI Project Groupings) Brief Description CNI Budget (in millions) % at ~$8 Billion* Replacement of Rail Cars Replacement of the 1000 and 2000/3000 Series rail cars. These cars are reaching the end of their lifecycles. $978 86% Replacement of Buses Purchase 100 buses a year to maintain an average fleet age of 7.5 years based on the 2008 fleet size of approximately 1,500 buses. $ % Rehabilitation of Rail Cars Rehabilitation of the 4000 / 5000 Series rail cars and safety & reliability enhancements to all rail cars. $265 82% Vehicles/ Vehicle Parts Rehabilitation of Buses Capitalization of existing bus programs including: Mid Life Overhaul, Engine Rebuild, Transmission Rebuild and Electronics Rebuild. $228 79% Vehicle Replacement Components Purchase of capital repairable items used to replace components of bus and rail fleet (e.g., seats, heaters, alternators, motors) $176 55% Purchase of MetroAccess Vehicles Replacement of paratransit vehicles to achieve an average fleet age of 4 years. $141 80% Replacement of Service Vehicles Replacement of specialized maintenance vehicle fleet and MTPD vehicles. $63 100% Rail System Infrastructure Rehabilitation Maintenance Facilities Rail Line Segment Rehabilitation Rehabilitation and Replacement of Bus Garages Maintenance of Bus Garages Maintenance of Rail Yards Rehabilitation of rail system segments varies by conditions and age, but could include traction power, automatic train control, communication upgrades, track fastener replacement, tunnel ventilation, platform slab and tile replacement, etc. $1,822 78% Rehabilitation/replacement of Southern Avenue, Southeastern (at DC Village), Royal Street and one additional bus garage. $489 58% Maintenance of bus garages including interior/exterior walls, floors, stairs, ceilings, shop/building equipment, locker rooms, office spaces, security systems pavement/fence, etc. $328 41% Maintenance of rail yards including interior/exterior walls, floors, stairs, ceilings, shop/building equipment, locker rooms, office space, fire escapes, security systems, pavement, fence, etc. $281 45% Systems and Technology Rail Maintenance Facilities Procurement, design, and construction of a test track and commissioning facility. $60 100% Projects required to comply with regulatory requirements at bus and rail facilities Environmental Compliance Projects (e.g., underground storage tanks, storm water, air emissions) $37 100% Operations Support Software Business Support Software & Equipment Upgrades to Bus & Rail Asset Management software, Bus and Rail Operations Support Software, MTPD Dispatch and Records Management, Data Centers, Network Operations Center, and Network and Communications. $426 48% Upgrades IT Security, Document Management, Currency Processing Machines, Metro's IT Helpdesk and Management Support Software. $256 30% Power System Upgrades Rail Upgrades to rail power systems to support 8 Car trains. $25 100% Rail Fare Equipment Upgrades to fare equipment including fare media encoders, automatic fare collection hardware, debit/credit processing requirements, and maintaining the NEXTFARE system. $24 100%

24 Performance/Safety Focus Projects (Continued) Asset Categories Project Type Brief Description $11 Billion CNI Budget (in millions) % at ~$8 Billion Track and Structures Passenger Facilities Maintenance Equipment Track Rehabilitation Station/Tunnel Rehabilitation Elevator/Escalator Facilities Maintenance of Rail Station Facilities Bicycle & Pedestrian Facilities Rail Maintenance Equipment Heavy Duty Track Equipment Bus Repair Equipment Business Facilities Equipment Procurement of material and specialized equipment to implement the following Right of Way rehabilitation programs: Track Rehabilitation, Track Welding, Floating Slabs, Grout Pads, Structural, Third Rail, and Track Fasteners. $ % Repair 2,200 leaks per year to maintain the structural integrity of the tunnel liners and prevent the corrosion of wayside systems and equipment. $46 79% Rehabilitation and safety upgrades of the oldest and poorest performing elevators. Metro has 265 elevators at 86 stations and 18 facilities. $234 81% Preventive maintenance work at parking lots and continued implementation of Station Enhancement Program. $134 60% Replace remaining Rack III style bike racks and other structurally damaged; implement a locker replacement plan. $5 100% Rehabilitation of Right of Way graphics and switch machines; purchase of a geometry vehicle and other ROW work equipment. $ % Procurement of portable rail work and test equipment including generators, welding carts and other shop equipment. $44 100% Replace capital support equipment including jack stands, wheel dollies, pressure washers, parts cleaners, test equipment, paint booths, etc. $29 100% Replacement of warehouse materials handling equipment, vertical storage units, shelving, and racking for all 23 storerooms in Metro's facilities. $8 100% Other Facilities Business Support Facilities Renovation of the Jackson Graham Building and the Revenue Collection Facility. $29 100% MTPD Support Facilities Construction of a new MTPD District 2 Substation and a MTPD Special Operations Division Facility. $21 100% Performance Focus Subtotal $7,597 76% Customer/Demand/Safety Focus Projects Asset Categories Project Type (CNI Project Groupings) Brief Description $11 Billion CNI Budget (in millions) % at ~$8 Billion Passenger Facilities Rail Station: Capacity/Enhancements Bus Priority Corridor Improvements Bicycle & Pedestrian Facilities Rail Station Equipment Improvements to pedestrian flow, vertical transportation and platform capacity at core stations, backup elevators at 7 key MetroRail transfer stations, pedestrian connections at key stations and extended platform canopies for 8 car trains. $1,184 10% Funding to assist local governments and State DOTs to implement road and traffic measures to support Bus Priority Corridors. $120 50% Add bicycle parking capacity (cages and vendor operated stations) and enhance pedestrian access to stations. $40 5% Purchase 110 Automatic External Defibrillators and increase supply of Emergency Tunnel Evacuation Carts. $22 100% 2

25 Customer/Demand/Safety Focus Projects (Continued) Asset Categories Project Type (CNI Project Groupings) Brief Description Maintenance Facilities Vehicles/ Vehicle Parts Systems and Technology Rail Maintenance Facilities Expansion of Bus Garages Expansion of MetroAccess Garages Rail Car Fleet Expansion Bus Fleet Expansion Bus Enhancements MetroAccess Fleet Expansion Power System Upgrades Rail Operations Support Software $11 Billion CNI Budget (in millions) % at ~$8 Billion Provide rail car storage and shop capacity to support 75% and 100% 8 car train operation on the Red, Orange and Blue lines. $ % Additional capacity for bus storage in order to meet anticipated bus demand growth. $445 73% Obtain MetroAccess maintenance facilities and/or improve existing WMATA properties to house paratransit operations. $16 100% Purchase 230 additional rail cars in order to fully implement 75% and 100% 8 car trains. $ % Purchase 325 new buses to serve priority corridor networks and to cover projected demand increase. $255 70% Technology improvements for Metro's older buses, including consolidated Wireless Local Area Network, AVL and cameras. $ % Purchase 803 MetroAccess vehicles in order to serve projected increases in passenger population. $44 100% Completion of traction power system improvements in order to fully deploy 100% 8 car trains. $ % Modernize Metro's communication system with customers, enhance GIS mapping capability and implement power management strategy. $134 66% Business Support Software & Equipment Hardware upgrades to support enhancements to Metro's web site. $40 100% Rail Fare Equipment MTPD Support Facilities Equipment to support Automatic Fare Collection system, (including conversion to Universal Vendors and coin collection) and potential investment in Open System. $32 100% Construct a Police Training Facility and New District 4 Substation (to serve Dulles, western Metrorail and expanding bus service). $23 100% Other Facilities MetroAccess Operations Facility Construct 8 MetroAccess operating garages to house paratransit operations. $8 100% Business Support Facilities Improvements to Revenue Collection Facility to address growing ridership and enhanced security at JGB. $4 100% Customer/Demand Focus Subtotal $3,834 63% Total $11,431 72% * $8 billion funding constraints represents a reasonably expected funding projection based on historical funding levels and federal dedicated funds (see 11/6/08 FAO Board presentation "Capital Financing Plan") Note: Additional capital needs identified by NTSB will be addressed. 3